As part of its efforts to make the real estate sector fully transparent and in compliance with global benchmarks, authorities in Dubai are planning to launch a real estate performance index that will help international investors track and evaluate the sector’s performance.
Dubai was ranked the most transparent realty market in the Middle East and North African region in a survey conducted by global consultancy GRETI, which said the emirate recorded a 10 percent improvement in its score over the past two years.
Dubai moved to the top of the ‘Semi-Transparent’ category, where it sits on a par with Tier 1 cities in the BRIC countries (Brazil, Russia, India and China) and all four of the fast-growing MIST economies (Mexico, Indonesia, South Korea and Turkey).
Dubai’s real estate sector has seen improvements over the past few years owing to numerous initiatives taken by the Dubai Land Department (DLD) and Real Estate Regulatory Agency (RERA). These include registration of each and every realty transaction in the emirate, DLD Investment Map, the Rental Increase Calculator, Brokerage Ranking and Service Charge Index.
The sector has also seen enactment of several laws over the years that have regulated property developers, resulting in more secure and fairer deals for buyers and investors.
With Dubai’s realty sector already climbing global ranks, the new index will surely be a giant leap forward. DLD Director-General Sultan Buti Bin Mejren said in a recent report that while the authorities were content with the progress the sector had made, further “initiatives are required if Dubai is to achieve its goal of delivering a more transparent market”.
Bin Merjen said the major improvements would be required in areas of performance measurement. “The current lack of a real estate performance index is a major constraint for institutional investors seeking to benchmark the performance of their assets.”
“The DLD is actively looking to create such an index,” he said, adding that, “We are confident that such an index will be in place” by 2018.